Full coverage of the City Hall corruption case in federal court

Feds: Mercado set to enter plea on 5-year felony charge

Former Detroit water boss Victor Mercado Mercado is expected to be the second member of the so-called Kwame Kilpatrick Enterprise to plead guilty in the City Hall corruption case. Former Kilpatrick aide Derrick Miller pleaded guilty and is awaiting sentencing.

Mercado, who is due in court at 10:30 a.m. Monday, was facing up to 20 years in prison if convicted of charges including racketeering conspiracy, extortion and obstruction of justice.

Mercado, who headed the Water and Sewerage Department from 2002 to 2008, is accused of steering contracts to the mayor’s friend and co-defendant, Bobby Ferguson, lying during a federal investigation into one city contract, pocketing a $240,000 salary and hiring a private company to sweep his offices for listening devices, prosecutors allege.

Mercado’s lawyers have said he was not a member of Kilpatrick’s inner circle and was a victim of Kilpatrick’s criminal racket.

According to prosecutors, Kilpatrick allegedly headed a criminal enterprise that robbed taxpayers of millions and instilled a culture of corruption in one of the nation’s poorest cities.

Among the charges in the indictment: Kilpatrick and members of his so-called criminal enterprise threatened witnesses with violence and withheld city funds from firms that wouldn’t pay to play. Kilpatrick allegedly pocketed a $10,000 kickback in a restaurant bathroom, according to prosecutors.

The enterprise included his father Bernard Kilpatrick, Ferguson and Mercado, according to an indictment.

The group faces federal charges that include racketeering conspiracy, extortion, bribery, fraud and tax evasion.

The various charges carry penalties ranging from three years in prison to 20 years.

The corruption trial is on a hiatus until Nov. 13 to let Ferguson’s lawyer recuperate. On Friday, Edmunds agreed to the break, which means jurors will have to go more than two weeks without hearing testimony in the early stages of a complex racketeering case that could stretch into February.

The break is to give attorney Gerald Evelyn time to recover from a medical condition that flared last Monday while the veteran defense lawyer was cross-examining a contractor who was allegedly extorted by Ferguson. Evelyn, 60, was briefly hospitalized last week.

Robert Snell is the Detroit News federal courts reporter. He can be reached at rsnell@detnews.com or (313) 222-2028.